Being in government is a no-win mug’s game

Friday, December 14, 2012

By Jim Power

For many observers of the political, economic scene in Ireland, the last week has been pretty depressing.

Last week, the Government, democratically elected by the majority of the electorate in Feb 2011, presented the budget. There were no real surprises because the almost €3.5bn adjustment had been well heralded since late 2010. Most of the details had been cleverly or cynically — depending on one’s perspective — leaked to the media by a few ministers in the week leading up to the event.

Despite this, the reaction from the media, some of our political elite, and some elements of the public has been vitriolic. Newspaper editorials and columns, supposedly balanced television and radio presenters, not to mention many of those we pay to legislate on our behalf, have reacted strongly. Indeed, certain pieces written have been nothing short of personally insulting and incredibly vitriolic towards some in Government.

Some of the scenes in the Dáil would be funny if they took place in a senior infants’ classroom, but they are not quite so amusing when they are played out by well-paid politicians.

In some ways this sort of reaction is not terribly surprising, because no policymaker will ever be able to please all of the people all of the time, or indeed any of the people any of the time.

However, it is the job of elected policymakers to make policies, and if we don’t like them, we get an opportunity every five years or so to get rid of those same politicians.

I passed by the Dáil on Tuesday. A number of protests against the budget were going on outside, and the carers were particularly vocal. A little further down the street, farmers were protesting outside the Department of Agriculture.

Other left-leaning TDs, trade unions, and campaign groups organised a protest outside the Dáil on the following day against cuts to child benefit, respite grants, the clothing and footwear allowances, and other “repressive measures” in the Social Welfare Bill. They were calling on the Government and on Labour in particular to abandon these cuts and find savings elsewhere “through progressive tax on high earners”.

Many high earners would argue they are already taxed in a very progressive manner, a claim backed up by Ireland having one of the highest marginal tax rates in Europe, when PAYE, PRSI, and the USC are taken into account. Furthermore a small percentage of taxpayers actually pay the bulk of taxation in this country, and the more one earns, the more tax one pays.

The reality of course is that everybody feels they are hard done by and believe it is fine as long as somebody else is suffering and not them. It is also the case that due to pledges made by politicians, it was not possible in last week’s budget to touch income tax rates or the bulk of the 74% of current spending made up of social protection, public sector pay, and pensions.

Social welfare rates are protected by a Labour pledge not to touch them, while public sector pay and pensions are protected by the Croke Park agreement.

Given these facts, it was always going to be inevitable that a scattergun approach would be applied to expenditure cuts and revenue-raising measures, and that painful, repressive mistakes would be made.

No matter what the Government did in the budget, people would be up in arms. For example, I have argued ad nauseam that taxing child benefit would be infinitely preferable to taking a fixed amount off all recipients. To say this is an unpopular suggestion would be an understatement

The whole sorry mess leads me to believe that Ireland is becoming ungovernable and that the democratic process is being gradually dismantled.

I just thank my lucky stars that I am not a politician in government. It is a no-win, mug’s game, which is a pity.